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Industry News
 Prepared by: CPA International, Inc.

 April 2010
Hapag-Lloyd Hikes India
RatesHapag-Lloyd Hikes India
   Hapag-Lloyd will seek a general rate increase on all cargo
    moving from India to the U.S. East and West Coasts,
    effective May 1.
   The planned increase will be $600 per 20-foot container,
    $750 per 40-foot container and $845 per 40-foot high cube
   The move follows a similar GRI announcement by Dubai-
    based United Arab Shipping Company covering the same
    trade lane. Effective May 1, the UASC increase will be $500
    per TEU.
   The Middle East carrier will also increase rates on the
    eastbound trades from North Europe to the Indian
    Subcontinent and the Middle East.
   Effective April 1, the increases are: $100 per TEU and $200
    per FEU for shipments to the Indian Subcontinent, the
    Arabian Gulf and the Red Sea region; and $150 per TEU and
    $250 per FEU for shipments to Asia.
FedEx Launches Automated
International Document System
   FedEx Corp. said it has launched a system that
    allows shippers to electronically upload and
    manage international shipping documents.
   The FedEx Electronic Trade Documents system
    allows customers to migrate to a fully automated
    system for international shipping, the carrier said.
   Benefits of the system include the speed of
    electronic transmission, elimination of paperwork
    and streamlining of the customs process, FedEx
   FedEx Corp. is ranked No. 2 on the Transport
    Topics 100 listing of U.S. and Canadian for-hire
A National Intermodal Shift
   The Obama administration is forming a national freight
    transportation policy that can be boiled down to one concept:
    Get more trucks off the roads.
   “We want to keep goods movement on water as long as
    possible, and then on rail as long as possible and truck it for
    the last miles,” Deputy Transportation Secretary John Porcari
    said at a March 24 Senate Environment and Public Works
    Committee hearing.
   In a single sentence, Porcari described what appears to be
    the most sweeping change in a generation in the federal
    government’s approach to shipping and transportation,
    promising an ambitious and concerted effort to redirect the
    way freight flows through the country’s long-standing supply
   The DOT’s intermodal strategy is upending a long-standing if
    sometimes uneasy balance between transportation interests
    in Washington and transforming debate over federal
    transportation dollars. It comes as Congress and the White
    House grapple with spending priorities and even a schedule
    for turning a proposed $500 billion surface transportation bill
    into law.
A National Intermodal Shift
   But the Obama administration is looking beyond the
    traditional multiyear highway bill for other ways to fund
    infrastructure projects, whether an infrastructure bank
    or new rounds of discretionary grants aimed primarily
    at intermodal freight.
   With the number of non-freight and non-highway
    groups seeking a share of federal transportation
    dollars growing, trucking interests are calling for
    stronger safeguards against any diversion of money
    from the fuel tax-fed Highway Trust Fund.
   Porcari’s comments echo remarks Transportation
    Secretary Ray LaHood made in an interview last
    month with The Journal of Commerce, when he said
    six times that “getting more trucks off the road” is a
    prime objective of the DOT’s freight transportation
YRC Worldwide Shipments Rose
in March
   Trucking giant YRC Worldwide says its daily shipment volume
    improved month-to-month in the first quarter, but business
    levels remained depressed from a year ago.
   The preliminary first quarter shipment statistics indicate the
    company’s bounce back from the recession and its close
    brush with bankruptcy is proceeding slowly.
   The $5.3 billion company’s nationwide less-than-truckload
    carrier YRC handled approximately 42,700 shipments per day
    in the first quarter, the carrier reported.
   Customer fears raised by YRC’s battle to stave off bankruptcy
    late last year and brutal winter storms in February drove
    down shipments in early 2010, the company said.
   But shipments are blooming this spring. The average number
    of shipments handled rose each month from 41,100 per day
    in January to 44,900 per day in March.
CSX’s First-Quarter Income
Rises 22%
   Eastern freight railroad CSX Corp. said its first-quarter
    net income earnings-per-share jumped 22% from a
    year ago.
   Net income rose to $306 million, or 78 cents a share,
    from $246 million, or 62 cents, a year ago, CSX said
    late revenue rose 11% to $2.49 billion.
   Freight carloads rose 5%, led by a 64% jump in
    automotive shipments, the Associated Press reported.
    Commodity shipments such as chemicals and metals
    also improved.
   Intermodal revenue rose to $323 million, from $270
    million a year ago, while intermodal operating income
    increased to $39 million, from $24 million.
   CSX operates in the eastern United States and parts
    of Canada.
CSX Rates to Rise 4 to 5 Percent
in 2010
   CSX Transportation is sticking with its earlier guidance
    to see core pricing gains of 4 to 5 percent during 2010
    although its first-quarter price gains were at the top of
    that range.
   CSX reported price gains of 5 percent in the quarter
    ending March 26 on what it calls “same-store”
    business, which is the company’s way of comparing
    freight activity on same lanes for the same
   The rail firm has 85 percent of our contractual
    business already signed and in place or this year, and
    good visibility into how the remaining 15 percent may
    unfold. So they will stick for now with the company’s
    previous full-year rate increase guidance for overall
Truckload Spot Shipments
Rocket in March
   Truckload spot market freight volume reached pre-recession
    levels in March, climbing 259 percent from a year ago and 14
    percent from March 2008, according to TransCore’s North
    American Freight Index. The index broke 1,000 for the first
    time since June 2008.
   It was the sixth straight month of positive year-over-year
    comparisons in the index, which is based on millions of spot
    truckloads and available trucks fed into TransCore’s DAT
    Network -- a load board for shippers and carriers in the
    United States and Canada.
   The spot market index supports truckload carrier claims of
    higher volumes in recent weeks and months. “We exceeded
    our goals for the first time in 18 months in March,” Pat Quinn,
    co-chairman of U.S. Xpress Enterprises, told The Journal of
   “We’re definitely seeing a pickup in demand, though I’m not
    sure if it’s the economy picking up or the result of 15 percent
    of the available trucks being taken out of service,” said Quinn,
    whose company operates about 6,000 tractor-trailers
Truckload Spot Shipments
Rocket in March
   The strength of the spot market measured by
    TransCore’s index is underscored by quarterly
    results, as well. Total spot freight volume more
    than tripled in the first quarter of 2010 over the
    same period in 2009 and was 11 percent higher
    than in 2008.
   The spot market results for the 2010 quarter
    exceeded first quarter results for every year since
    2004, when volume was 4.5 percent higher.
UPS Sees Higher First-Quarter
   UPS Inc. said its first-quarter earnings per share will
    increase to 53 cents, from 40 cents a year ago, while
    adjusted earnings will be 71 cents, up from 52 cents
    last year.
   As a result of the strong earnings and an improved
    outlook for the remainder of the year, full-year adjusted
    earnings will be $3.05 to $3.30 per share, “a significant
    increase over the $2.70 to $3.05” guidance provided in
    February, UPS said .
   First-quarter revenue rose 7%, led by increases of
    18% in the international package unit and 14% in the
    supply chain and freight segment.
   International daily volumes grew significantly with
    exports up more than 9%, while U.S. domestic daily
    volume rose less than 1%, the first year-over-year
    growth in more than two years.
ABF, Teamsters Reach Tentative
   ABF Freight System and the Teamsters union said they have
    reached a tentative agreement to modify the labor agreement
    for the company’s employees covered under the National
    Master Freight Agreement.
   No details were released by either side, but an ABF official
    said the less-than-truckload carrier could release elements of
    the plan as early as the beginning of the month.
   The Teamsters said in a posting on its Web site the plan will
    be presented to leaders of local unions representing ABF
   “The leaders will be asked to endorse the plan at the meeting
    in Chicago [and] if leaders endorse the plan, members will
    then have the opportunity to vote on whether to approve the
    plan,” the union said.
   ABF began talking with the Teamsters about cost reductions
    last year as its losses mounted. Excluding one-time costs,
    parent company Arkansas Best Corp. lost $99.9 million in
    2009 after posting a profit of $49.1 million the year before.
   Arkansas Best Corp. is ranked No. 18 on the Transport
    Topics 100 listing of U.S. and Canadian for-hire carriers.
Truck Rates Primed to Rise
   Trucking rates have nowhere to go but up, and they’re ready
    now, several speakers told freight shippers at NASSTRAC's
    annual conference.
   "Price increases will be coming, and they may be coming
    sooner rather than later," said Chad Thomas, director of
    intermodal at J.B. Hunt Transport Services.
   He was talking about truckload rates, but other speakers at
    the conference in Orlando, Fla., said the same holds true for
    less-than-truckload pricing.
   "From a shipper's perspective, rates are going to go up," said
    Jon A. Langenfeld, transportation analyst and associate
    director of research at R.W. Baird & Co.
   In truckload, "Rates are going to move higher if for no other
    reason than the age of the capacity base out there," he said,
    noting that many older trucks are being retired.
   "The age of the fleet today is as low as it's been in a
    generation, and that means there's not a lot of capacity out
    there for when demand increases.“
Truck Rates Primed to Rise
   "In truckload pricing, the pendulum has swung,
    and if you haven't talked to your carriers yet, get
    out there and do it before they come to you,"
    Langenfeld said.
   On the LTL side, "it's going to take longer, but the
    trend is definitely up." Shippers are bracing for
    rate hikes while looking for ways to lower costs.
   "I see a lot of trouble explaining to our
    management why we need all these rate
    increases," said Candace Holowicki, manager of
    logistics at Masco Corp.
FedEx Freight May Put
Shipments on Rail in Future
   Trucking company FedEx Freight, which has pointedly
    rejected rail transport in the past, could switch and turn to
    intermodal in coming years if the price is right and customers
    want the option.
   The transportation industry is changing rapidly, and carriers
    must also be ready to change, Bill Logue, president of FedEx
    Freight, told shippers at the NASSTRAC annual meeting
    "Customers want options," said Logue, president of FedEx
   Logue says he isn't ready to drive freight toward intermodal
    yards. "We find in most cases the railroads still have a transit
    time issue," he said.
   "But five years down the road, intermodal may be much more
    significant. As international globalization continues, the
    dynamics will change, and there will be an opportunity for
    more rail," Logue said.
Diesel Edges Up for Fourth
   Average price increases four-tenths of a cent to $3.078
    per gallon
   The average price of diesel edged up four-tenths of a
    cent to $3.078 per gallon last week, according to the
    U.S. Energy Information Administration. In increments
    of less than a penny, the price of diesel barely
    increased over the last two weeks of April to stretch a
    four-week run of rising prices.
   The slow pace of increases extends an upward trend
    since prices hit their most recent bottom just over a
    year ago at $2.09 per gallon on March 23, 2009.
   The last time diesel was over $3 per gallon, it had
    fallen for four months from its historic peak of $4.764
    per gallon on July 14, 2008 to $3.088 per gallon on
    Nov. 3, 2008. Prices were in the midst of a steep
    correction that brought them as low as $2.09 per
    gallon by March 23, 2009. Since then, a slower and
    less steady pace has brought the price up again.
Transportation Industry
   For specific questions regarding
    these topics, please contact
    CPA International toll free at
    888-684-4288 or via Email for details.

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